Growth in the grocery sector has slowed since January, with sales up +2.5% compared to +3.3% this time last month. However, there is opportunity for retailers online, as the online grocery market has hit a huge value of £8.5bn per annum.

The slowdown in grocery growth this month can be attributed to a drop in spend per visit, as consumers are increasingly cautious with their spending against the backdrop of Brexit and economic uncertainty. Since the start of the year, shoppers are shopping more often and, as a result, are buying fewer items.

Over the last four weeks, the average spend per visit has fallen to £16.30 from £16.70* this time last year, down 2%, as a result of the resurgence of ‘little and often’ shopping behaviour but also due to price cutting by supermarkets.

In 2018, the two fastest-growing grocery channels were discounters (where sales increased +11%) and online (where sales were up +8%), and the market size reached £8.5bn per annum*. Convenience is a key motivator for shoppers who go online to buy food and drink, as well as helping to manage household budgets and being able to save time.

The recent announcement of Marks & Spencer/Ocado’s joint venture is an indication of the accelerating pace of change in the retail sector - while Marks & Spencer is strong on fresh food and events, it’s in partnering with Ocado, which has a compelling delivery offer for some, that the retailer will open up new opportunities to reach more shoppers.

As almost half of all households buy food or drink from a Marks & Spencer store, the tie up with Ocado is a great opportunity to extend this already significant shopper reach into the growing online channel. For online, it’s the ease of the shopping experience and the chance to discover new and exciting products that differentiates a retailer and engages new shoppers. Future retail growth will come from meeting lifestyle needs rather than being reliant on the location of a store.

In terms of retailer performance over the last 12-week period, Tesco leads with 26.8% market share, followed by Sainsbury’s at 14.8%, Asda at 13.8% and Morrisons at 9.8%.